International Consortium of Investigative Journalists

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World Bank overlooked families in Nepal project, panel finds

Power lines in Nepal.

The World Bank failed to make sure that families displaced by a high-voltage power transmission line in Nepal were properly counted and compensated, an internal panel at the bank found this week. The revelation marks the latest instance in which the development giant was faulted by its own watchdog for not following its own rules on forced, or “involuntary,” resettlement.

In Nepal, the Khimti-Dhalkebar Transmission Line was part of a power project financed with $75 million from the World Bank, which finances government-sponsored development projects in poor countries. The bank invested in the transmission line nearly a decade ago, with the goal of “distributing power to an energy-starved country” that suffers lengthy blackouts during the winter. But villagers who live in the path of the project claim they weren’t consulted about the route of the transmission line, and say they are being forced to give up their land and homes to make way for the project without fair compensation.

In a July 13 report, the bank’s Inspection Panel found that the World Bank improperly relied on an outdated 2006 census conducted at the project’s inception to determine who would be affected by it. As a result, Nepalese authorities did not count dozens of families that had moved onto land needed for the power line in the following years, a period in which a Maoist insurgency slowed the project. Some villagers say they were paid late for relinquishing their land for the power line’s construction, others weren’t paid enough, and some weren’t paid at all.

With the project nearly complete, the current dispute is limited to a small number of landowners living along a 4-kilometer stretch of the power line’s route who are holding out against giving up their land, World Bank spokeswoman Lotte Pang said.

She said the bank has learned its lesson about how conflict can reshape conditions on the ground. “Going forward, the Bank will do more to take such volatility into account when designing projects,” Pang said.

The International Consortium of Investigative Journalists, The Huffington Post and other media partners revealed in April that an estimated 3.4 million people have been physically or economically displaced by projects financed by the World Bank over the last decade. During that period, the reporting team found that the bank regularly failed to follow its own requirements to ensure that displaced communities are protected from abuses and resettled in equal or better living conditions.

The Nepal Power Development Project, which includes the Khimti-Dhalkebar Transmission Line, is one of several controversial projects before the World Bank Inspection Panel involving community complaints that the bank failed to comply with its resettlement policies. These rules were created by the bank to ensure that the often very poor people who live on or near land wanted for development are protected from abuses, and that their livelihoods and living conditions are restored if they are forced to move.

Dilek Barlas, the World Bank Inspection Panel’s executive secretary, told ICIJ that complaints from people who claim the bank didn’t adhere to its own resettlement rules are a recurrent theme in the panel’s work.

In a current case in Kenya, Masai tribesmen have complained they were pushed aside by a by a World Bank-financed geothermal power plant without proper compensation, and villagers in Kosovo say they are being forced from their homes into temporary housing in a remote, deserted city, to make way for lignite mines for a coal plant backed by the bank.

“We hope the latest reports draw the attention of the bank,” Barlas said.

The World Bank has announced an action plan to better enforce its rules on resettlement and other social and economic “safeguards,” and says that it is making “significant progress” toward this goal. A progress report on the action plan is expected by the end of September, said Pang, the bank spokeswoman.

However, several former World Bank managers have expressed concerns about whether the plan will work, and the bank has yet to document that it is enacting several reforms outlined in the action plan, like boosting funding for oversight.

While the bank’s Inspection Panel credited the financial giant for acknowledging  problems with the Nepal Power Development Project and acting to rectify them, it also said that the bank had failed to meet its own obligations in several key areas.

In its initial calculation, project backers identified 17 households as “severely project affected,” a technical definition that means that they would lose at least one quarter of their land to the project. But that count was far too low, the panel concluded. A 2014 census conducted after the community filed its complaint found that this number had swelled to 94 households, more than 60 of which would be forced from their homes. The bank’s failure to enforce its policy resulted “primarily as a consequence of reduced engagement,” the panel concluded, while also noting that the bank’s job was made harder by the Maoist insurgency that temporarily prevented travel to the region.

Furthermore, the World Bank had failed to properly address concerns raised by local communities about  the potential hazards of living near a high-voltage transmission line, which passes over a school and other structures, the panel said.

It also did not adequately consider alternative routes for the transmission lines, and did not provide an accessible grievance mechanism for villagers who said they were harmed.

The power project remains incomplete and unable to transmit electricity due to the ongoing dispute with families who live along the route’s final stretch who still refuse to give up their land to allow power lines and towers.

The holdouts don’t oppose the notion of a power transmission line, but some believe there is a better route -- one that doesn’t cut through their land, said Komala Ramachandra of Accountability Counsel, an advocacy group that is representing the affected families.

“What communities are looking for is to have a say in how this project goes forward,” she said.

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